The organizers underlined that the main goal of the "Ukrainian Soybean Congress" was to enhance understanding of Ukrainian producers the technological and economic aspects of efficient cultivation, processing and sale of soybean; create a single business platform for communication among agricultural producers, agronomists, representatives of processing business and buyers of soybeans from Ukraine and Europe. The event was attended by over 150 owners and top managers of agricultural companies, holdings, farms, input suppliers, traders and representatives of international organizations.
Growing interest of domestic farmers to soybean can be explained by attractive prices and high demand for this grain and products of its processing on the world market. In 2015 the cultivated area under soybean had reached a record number of 2.1 mln ha, that was 17% more than previous year. However, the crop yield was 17-18% lower than in 2014. In general, the average yield of the crop in Ukraine is 28-37% lower than in the leading world countries: the United States, Brazil, Argentina, Canada, and the EU.
Chairman of the Association of producers and processors of soybeans, Victor Tymchenko believes that area under soybean will continue growing for several reasons: it is used for processing the feed, soy improves soil accumulating nitrogen in an average of 100-150 kg/ha of planted crop, and it makes savings on nitrogen fertilizers and increases the yield of wheat and corn (as a previous crop).
"Resent years we can observe rapid growth of the cultivated land under soybeans and its production volumes. But in terms of technology, it is a specific and challenging culture. Last year, the cultivated area under soybean has increased, but the yield was lower compare to 2014. This indicates that soybean is quite difficult for growing. So, we invited for today event experts on technologies, processing and export of this culture in order to exchange experience, discuss important issues, and establish cooperation as well as find new partners”, - said Taras Vysotskyi, Director General of the Association "Ukrainian Agribusiness Club".
Following this opinion, today we can see the trend towards increasing exports of first processing soybean products. «It is quite difficult to compete with this crop on the foreign markets, because the leading countries as Brazil, Argentina, the United States have lower production cost, so Ukraine needs to learn how to use its competitive advantage – logistical proximity to final consumer of processed products: meal and oil, - says Taras Vysotskyi. – We have a gap with facilities for meal and oil production, so there is a need to develop such facilities to let domestic companies receive an extra margin on their sale, because the margin is often higher than on soybeans export”.
Dmytro Semenenko, Deputy Director of А.Т.К. described how they work with farmers and which financial support А.Т.К. provides to farmers for growing soybean.
As for today, the world biggest companies don't supply elite seeds which could be breeded in Ukraine. The reason is the lack of practices to pay copyright for the cultivation of such seeds in our country. Soybean market in developed countries interact with customers just in such way. Company A. T. K. has chosen the other way. We work with originators - Canadian companies, which are the authors and producers of the best samples of soybean. We buy from them super elite seeds, breed them and pay royalty.
We maintain partnerships with farmers from different regions of Ukraine. Today we work with more than 200 farmers. We give a loan to them through the seeds, fertilizers, CPP. We provide them with real agronomy consultations on growing corn, sunflower, soybean. Our agronomists work on the farms’ fields: they analyse the soil and its preparation, give a clear set of recommendations, they assist in adjusting the seeding equipment, and control the quality of sawing. Also, our agronomist-consultant gives recommendations on CPP to be used and when they should be applied, he regularly inspects the crops until harvesting”.
The expert thinks that soy is universal, profitable and promising crop. "Ukraine will continue to grow up the production, and facilities for soybean processing will be developing. When it happens, soybean will become even more attractive for farmers. The same way was made by sunflower in our country", - said Dmytro Semenenko. Participants of the Congress have also discussed the issues related to volumes of soybean production and processing in 2015, and perspectives for production season 2016; the quality of products when supplying for export, growing and processing of non-GMO soybean; entering the Chinese market, and logistics (DAF – border of Ukraine-EU), etc.
Eugenia Novozhilova, Director of "Export Certific" thinks that it is necessary to optimize the number of indicators of safety for soybean and processed products to meet international requirements and promote Ukrainian products on global market avoiding non-tariff technical barriers to trade. "The new Law No.1602 “On the basic principles and requirements for the safety and quality of food products” allows farmers to follow norms recommended by normative documents of international cooperation if such norms and indexes of safety for row products or processed products are not foreseen by Ukrainian legislation. Therefore, the compliance of the raw material/finished product with international norms of safety is a prerequisite for export and DCFTA” – mentioned the expert.
"Quality of Ukrainian soybean and processed products is certainly important for competition on the markets, which today are Turkey, Iran, Egypt, and only in the last turn Europe. However, the main problem in export increasing is the lack of a clear market strategy for Ukraine and understanding of the target markets. As result, the Ukrainian farmers and the entire soy complex lose their possibility to obtain profits. When commodities super-cycle is completed, Ukrainian farmer needs a competitive advantage to fight for being presented and promote products on existing and new markets" - said Sergiy Nevsky, Executive Director on Oil Crops, Louis Dreyfus Commodities Ukraine.
Andriy Shkliar, Head of Expert department, The Center for transport strategies, in his presentation focused on details on the major countries-importers of Ukrainian soybean, the dynamics of external supplies and logistics channels. In particular, he noted that the main buyers of Ukrainian soybean today is Turkey and Iran. "These countries import 70% of our products. Last year, Turkey has bought up to 1 mln t of soybean, Iran – 400 th t, Egypt - 100 th t. EU countries are not so active yet in purchasing Ukrainian soybean: last year, Poland and Romania together have bought about 100 th t that is 75% of the overland exports through the western border. Mostly, soybean is exported by sea, cargo through Ukrainian ports last year amounted to over 2 mln t, the overland export was only 150 th t". According to the expert, despite the geographical proximity of the main countries-importers of Ukrainian soybean, domestic manufacturers avoid to export soybean independently and rather prefer to work with traders. "The producers are not willing to take risks related to freight and delivery control, so they prefer to work on terms of CPT and FOB at the port, and DAF when it in an overland transportation”- said the expert.
The IV th session was devoted to B2B meetings of producers, processors and buyers of soybeans in Ukraine and Europe. In parallel, participants of session "Growing and processing of non-modified soybean” could hear presentations about the best practices of some companies: PJSC "Myronivsky Hliboproduct”, “Export Certìfic", Danube soya Association, agriholding A.T.K. and corporation "Svarog West Group". They were focused on issues of growing the crop, financial support for producers, using of the processed products in animal feeding, introduction of quality systems on enterprises.
In addition, within the second part of the event, the legal company ALEXANDROV & PARTNERS held "Legal workshop on topical issues of agribusiness" to raise awareness of Ukrainian agricultural producers on the modern efficient approaches in doing business. Topics of the workshop included the use of non-resident companies in the agribusiness and restructuring of holdings, legal support in land disputes, land operations, criminal responsibility in agribusiness. Every participant of the Congress could get free legal advice.
Photo report of the congress – You may see link